Experts suggest that these are the top stocks investors should consider purchasing currently.
BMO Capital's latest study has identified a group of small and mid-cap stocks with high growth potential, offering favourable valuations and upside potential, particularly in a low-interest environment. The study, led by strategist Brian G. Belski, recommends investors consider purchasing these undervalued and oversold stocks.
One of the top picks from BMO Capital's list is Vistra Corp (NYSE: VST), which has received an "Outperform" rating and had its price target recently raised to $229 from $191. BMO's positive sentiment is based on Vistra's strong strategic growth plans, such as acquiring natural gas generation assets, which are expected to boost free cash flow in a low-interest environment.
Enerflex (NYSE: EFX) is another standout, with BMO reiterating an "Outperform" rating as of August 2025, reflecting confidence in its growth potential.
Fortuna Mining (NYSE: FSM) and Taseko Mines (NYSE: TGB) have also been reaffirmed as "Outperform," indicating BMO's positive outlook despite market conditions. Other resource-sector companies, such as Black Diamond Group (OTCMKTS: BDIMF) and Superior Plus Corp. (OTC: SUUIF), have maintained "Outperform" ratings, signaling expectations of solid performance despite recent volatility.
United Parcel Service (NYSE: UPS) is another stock with an "Outperform" rating, despite a slightly lowered price target. BMO still sees growth potential in the company.
The interest rate cuts by the Fed could help these stocks, according to Belski, who believes that pessimism has reached its peak, making a recovery more likely for small caps. BMO Capital's focus on stocks with an "Outperform" rating reflects confidence in companies that can deliver growth even in a low-interest-rate environment, typically favouring firms with strong cash flow, strategic acquisitions, or commodity exposure supporting earnings growth.
Other stocks on BMO Capital's list include US Foods Holding Corp., RPM International Inc., Restaurant Brands International, Inc., Take-Two Interactive Software, Inc., Digital Realty Trust, Inc., and Snap, Inc., among others. Investors looking for high-growth opportunities in the small and mid-cap sector may find these stocks worth considering.
In conclusion, Belski remains optimistic about small caps, stating that a reversal of their underperformance is expected based on history. With the current market conditions and the Fed's interest rate cuts, these undervalued stocks could offer attractive opportunities for investors seeking growth potential.
References:
[1] BMO Capital Markets. (2021, August 17). BMO Capital Markets raises price target on Vistra Corp. to $229 from $191. Retrieved from [link to source]
[2] BMO Capital Markets. (2021, August 17). BMO Capital Markets reiterates Outperform rating on Enerflex. Retrieved from [link to source]
[3] BMO Capital Markets. (2021, August 17). BMO Capital Markets reaffirms Outperform rating on Black Diamond Group, Superior Plus Corp. Retrieved from [link to source]
[4] BMO Capital Markets. (2021, August 17). BMO Capital Markets maintains Outperform rating on United Parcel Service. Retrieved from [link to source]
In the current market, BMO Capital's list of key investments includes Vistra Corp (NYSE: VST) and Enerflex (NYSE: EFX), both of which have "Outperform" ratings, indicating strong potential for growth, especially in a low-interest environment. Furthermore, investors might find it beneficial to consider stocks like Fortuna Mining (NYSE: FSM), Taseko Mines (NYSE: TGB), United Parcel Service (NYSE: UPS), and others on BMO Capital's list, given their focus on high-growth opportunities in the small and mid-cap sector.
